Azure Cloud: Mining the Ether (a practical guide)

A Practical guide to Mining and Transferring Tokens of Your Own Private Cryptocurrency

“Which cryptocurrency is better? Mine, of course! Please don’t make me sign up to another service, just let me trade Ether and create Tokens …”

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Like many old-school developers, my first instinct and best path to a deeper understanding of any new tech is to mock up a ‘Hello, World’ style proof-of-concept; here’s a quick intro to Ethereum Blockchain in Azure.

Decentralized applications (DAPPS) normally communicate and execute logic against the public Ethereum blockchain. Our private Ethereum test-bed consists of a peer-to-peer decentralized network of two mining nodes that maintain their own private distributed ledger and one dedicated networking node to support arbitrary computation against the ledger & maintain consensus.

How much Bitcoin will this cost?

None, but Azure resources are not free; they require either a paid (credit card backed) or time-limited, free trial subscription. The scaled-down solution deployed as described below should only cost a few cents per day. You should budget for a monthly hosting cost of around $15 USD/mo. for A0 HDD nodes or $50 USD/mo for 1_V2 Standard SSD nodes.

Why Ethereum? Autonomous smart contracts (written in a scripting language called Solidity) are used to author decentralized applications (DAPPS).

“Ethereum is a decentralized platform for applications that run exactly as programmed without any chance of fraud, censorship, or third-party interference.”

You must resist the naive temptation to scale-up your cloud resources to get rich mining Ether. “These are not the droids you’re looking for!” Call Genesis Mining or similar if your after a mining contract or hardware.

How do I make and transfer a Token of Ether?

You can buy Ether tokens (in exchange for Bitcoin or fiat currencies) or do cryptographic work to mine them or transfer them; every transaction has a Gas Pricethat must be satisfied in order for it to succeed. We can use our DAPP to issue tokens in exchange for Ether as follows:

Stay tuned for the next post in this series:

Kevin Belanger

A graduate of the University of Toronto (1996, BSc Physics) and the University of Victoria (2013 MSc, Earth and Ocean Sciences), Kevin enjoys aikido, canoeing, travelling, writing poetry and spending time with his family.

Art+Logic has been designing and developing innovative custom software since 1991. We have built software for over 900 clients from a diverse set of industries including education, aerospace, music technology, consumer electronics, entertainment, financial services, and more. Coding the “impossible.”®